As Mexico’s official investment promotion agency, ProMéxico plays an integral role in the country’s alignments, relations, and trade agreements with governments and multinational companies from around the world. During the Dual Year 2015 UK-Mexico, ProMéxico has been key to the promotion of business negotiation between the two countries. KITE Invest spoke with Ambassador Jesús Mario Chacón, Chief of ProMéxico’s Investment Promotion and International Business Unit, in order to find out just what steps ProMéxico has been taking in the strengthened alliance.
KITE Invest: What are the economic sectors that are offering the best investment opportunities right now for the international investment community?
Jesús Mario Chacón: At ProMéxico we seek to boost the sectors and national industries that have an increasingly important role in the world. Our advocacy is directed by three promotion objectives: attracting foreign direct investment, increasing Mexican products and services exports, and supporting the internationalization of national companies.
At ProMéxico we have established partnerships with various departments and agencies of the Government of the Republic in order to increase exports and support the internationalization process of successful Mexican companies.
In Mexico we have a very important manufacturing corridor that is now home to major multinational companies and is a clear example of our export strength. It includes the states of Aguascalientes, Guanajuato, Hidalgo, Nuevo León, Puebla, Querétaro, San Luis Potosí, and Tlaxcala.
The strategic geographical position of Mexico at the crossroads of the major routes of world tradeallows supply not only to the Mexican market, but also to the North American, Latin American, Asian, and European markets. Mexico is the ideal export platform for accessing nearly two thirds of global gross domestic product.
KITE: ProMéxico seeks to strengthen the areas of innovation and technology. How important are these two areas for the promotion of Mexican exports?
JMC: For our country it is crucial to strengthen innovation and technology; thus, we have decided to establish and reinforce supply chains in order to take advantage of global opportunities and consolidate our position as one of the leading global players. This will bring about growth and result in more investment announcements from players in sectors such as aerospace, automotive, electronic, and other advanced manufacturing.
It is important to highlight that Mexico is currently the third largest exporter amongst the G20 countries in terms of medium and high technology manufacturing. As a percentage of GDP, Mexico is just behind Germany and South Korea.
Also, more than half of Mexico’s exports are of medium and high technology manufacturing, placing our country as the leading exporter of these products in Latin America.
KITE: ProMéxico has a key role in the Dual Year between Mexico and the United Kingdom. What strategies is ProMéxico carrying out in order to promote business negotiations between enterprises from both countries?
JMC: The Dual Year provides a supplemental platform to the traditional tools of generating and promoting business. The Dual Year has not only committed both countries’ governments to a greater number of seminars and investment and export fairs, but has also increased their relevance. These events are focused on strategic sectors such as advanced manufacturing, medical equipment, creative industries and energy (oil and gas). ProMéxico is working with partners, such as UKTI, local chambers of commerce and business associations, to organize seminars and business meetings in cities and key business centres throughout the UK. ProMéxico representatives are conducting events in Birmingham, Manchester, and Liverpool, and for the first time, in cities like Bristol and Belfast.
One of the most important elements of the Dual Year was the State Visit by the President of Mexico, Enrique Peña Nieto, from 1 to 5 March. The visit highlighted the growing trade relationship between the two countries in sectors such as oil and gas and creative industries, and touched key places in the country, such as Cardiff and Aberdeen, where several business seminars and business conferences were hosted. The President was accompanied by a business delegation of more than fifty companies coordinated by ProMéxico. During the visit, various academic and commercial agreements were signed, and trainings were conducted to increase the tools available to the business communities of both countries.
Additionally, it was an ideal showcase for the industrial and productive capacities of Mexico, which aroseinterest and drew the attention of companies and new players unfamiliar with the business opportunities that Mexico offers to their businesses.
KITE: The energy reform in particular is a great opportunity for British companies. How is ProMéxico working to promote the entry of energy companies in the country? What was proposed in the agreements signed between ProMéxico with Royal Dutch Shell and British Petroleum?
JMC: The Mexican energy sector is benefitting from the efforts made during the year, and it is taking advantage of the interest and the attention generated during 2015. The Mexican Government’s commitment to the energy reform was confirmed by the visit of the President of Mexico to London and Aberdeen during which many business meetings and seminars were held.
However, ProMéxico has a basic strategy that goes beyond traditional promotional activities and the activities of the Dual Year. The basic strategy covers: information, presence, and support to generate business. In that sense, ProMéxico has approached the main forums and relevant associations of the British energy sector, to provide information on the opportunities presented by the reforms of the different subsectors. ProMéxico also has a strong presence in forums and conferences around the UK, acting as a first point of contact with companies seeking Mexican partners to generate business in any of the various energy subsectors. Finally, we work closely with companies that already have the interest and capital to invest in Mexico, supporting them at various stages of their current projects. This is possible thanks to the joint work between the different components of the Mexican Government in the UK, and ProMéxico’s allies, like the UKTI and some chambers of commerce.
One of the key tools for the Mexican business promotion strategy is the Asociación con trasnacionales model (ACT, Association with transnational companies model); both British Petroleum and Royal Dutch Shellare already part of it. The agreements derived from said model foster the development of companies in Mexico’s value chains. The agreements ensure that investors can count on quality local suppliers, which consequently reduces costs and boosts the development of Mexican companies.
ProMéxico is strengthening the attention placed on the sector in order to continue offering support to businesses that designate Mexico as a strategic location for the development of their business projects in the coming years.